Case Study

Financial Services Authority UK

The Client

The Financial Services Authority (FSA) is an independent non-governmental body, granted statutory powers by the Financial Services and Markets Act 2000. It has been the single regulator for financial services in the UK since December 2001.

The FSA now regulates most financial services markets, exchanges and firms. It sets the standards that they must meet and can take action against firms if they fail to meet the required standards.

High Street Firms

The Challenge

The FSA was responsible for statutory regulation of Mortgage and General Insurance from 2004/5. Nearly all of the 10,000 regulated firms required new permissions and in addition, 15,000 previously unregulated firms needed to become authorised. To accomplish this, the FSA tasked Vizor with providing a registration and authorisation system, with a focus on registration and application pack data collection, strong validation and workflows for scoring and routing.

The sheer scope of the task ruled out using traditional, paper-based approaches or rudimentary manual systems, but any on-line solution had to take account of a strict timetable fixed in EU and UK legislation.

Our Solution

Built on Vizor Software, Vizor implemented a solution for the collection, risk assessment and distribution of application packs electronically. This was a highly complex requirement, as firms varied from sole traders to the largest financial enterprises. Both the forms and the data collected were highly complex and varied accordingly by firm. The solution handled very high volumes, met extremely strict security standards, and interfaced with FSA back end systems.

High-level solution features:

• Based on firm profiles and characteristics, the application packs were dynamically generated, with firms only seeing sections relevant to their entity type. This allowed the complexity of the resulting application packs to be reduced, leading to an excellent user experience and successful submission by all firms. This was crucial requirement due to the low level of sophistication amongst many of the firms.
• The application provided highly secure web form functionality that supported all 12 complex levels of data validation for excellent data quality. This resulted in an absolute minimum of resubmissions due to incorrect or incomplete data.
• Submitted application packs were processed and given a risk score based on FSA-supplied algorithms. Depending on the result of the risk scoring, workflows were initiated allowing the application pack to be processed and ultimately allowing the firm to become authorised or denied authorisation.
• PDF versions of the forms were generated for firm printout. These PDFs were also sent to the FSA’s backend systems along with the form data in XML format.

The Outcome

The implementation went live within the required four months, a timeframe made possible through the implementation of our product, Vizor Software. The system was extremely popular with users - over 75% of new and 98% of existing firms chose the electronic route over the paper based alternative. The system comfortably handled peak loads with several thousand application pack submissions per day. Over 25,000 firm application packs were received, covering around 75,000 individuals.

The system was heralded as a complete success, and the FSA were able to achieve all of their targets. The system went live on time and within budget, leading to the broadening of the FSA’s regulated firm base to 28,000 firms.

Following the success of the project, Vizor went on to implement Firms Online – a large scale application for collecting and processing regulatory returns from newly licensed firms. The application also managed firms’ profiles and allowed profile changes by firms through the system.

The case study on Firms Online can be read here.

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